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AIBOC questions RBI’s restrictions imposed on Dena Bank

AIBOC questions  RBI’s restrictions  imposed on Dena Bank

Sentinel Digital DeskBy : Sentinel Digital Desk

  |  10 July 2018 1:33 AM GMT

Guwahati, July 9: All India Bank Officers’ Confederation (AIBOC), the largest officers’ organization having membership of around 3, 20,000 officers questions the restrictions imposed by the RBI on Dena Bank. The RBI imposed restrictions on Dena Bank from assuming fresh credit exposure and recruitment of staff. This has adversely affected both deposit and credit growth. The total deposits of the Dena Bank, which stood at Rs.106130 crore in end-March 2018 has fallen to Rs.103020 crore by end-June 2018. The employee strength of the Dena Bank had already declined from 13985 in March 2017 to 13613 in March 2018. Further, restrictions on staff recruitment will impair the operations of the bank and impede its revival, stated a press release on Monday.

It is understandable that the primary reason behind putting a ban on Dena Bank’s fresh exposure is the high non-performing assets(NPA). The focus should be on maximising NPA recovery and not to disrupt normal banking operations, which will make the Bank unviable. The RBI and the Union Government, which currently holds over 80% of equity of the Dena Bank, need to become stakeholders in the revival of the Dena Bank.

As stated above,the Confederation demands for the immediate implementation of the recommendations of the Parliamentary Standing Committee of Finance on NPAs since it is the best way out to bring down the NPAs drastically which will ultimately pave the way for solution to many problems faced by the Public Sector Banks. In this connection, the Confederation has already addressed a letter to the Governor RBI, registering strong protest against the decision to prevent Dena Bank from extending fresh loans and urge upon the RBI to reconsider the decision.

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